MGM Mirage in No Danger of Bankruptcy: Poll

NEW YORK ( TheStreet) -- MGM Mirage ( MGM) is in no danger of filing for bankruptcy in 2010, readers of TheStreet say.

An overwhelming 83.3% of voters in our weekly poll said MGM is safe, while a mere 16.7% of voters said the casino operator would file Chapter 11 this year.

MGM gave investors even more confidence in business on Friday when it announced that it successfully extended the maturity of part of its credit facility.

MGM Mirage entered into an agreement to extend the maturity of a part of its debt -- specifically, about $4.37 billion of its outstanding commitments under its $5.55 billion senior bank credit facility -- from Oct. 3, 2011, to Feb. 21, 2014.

"This Amendment underscores the tremendous confidence our bank group has in our company," CEO Jim Murren said in a statement. "The transaction provides us with additional long-term financial flexibility and reflects our continued commitment to strengthen our financial position."

Under the agreement, MGM would have to cut 20% in credit exposures to the lenders and the credit line would be re-tranched so that about $1.4 billion of revolving loans will be converted into term loans. This would leave a revolving credit commitment of about $2 billion, $400 million of which will mature in 2011.

MGM will also have to repay the approximately $1.2 billion it owes to lenders who didn't agree to extend their commitments.

Bankruptcy chatter arose last week on message boards after MGM reported a bigger-than-expected loss in its fourth quarter.

During the quarter, MGM lost $433.9 million, or 98 cents a share, compared with a loss of $1.15 billion, or $4.15 a share, in the year-ago period.

Excluding an impairment charge to write down the value of undeveloped Atlantic City land and other items, MGM lost 21 cents per share. Revenue dropped 11% to $1.45 billion from $1.62 billion last year

Granted, it should be noted that this is only message board talk, and should not be valued as anything more than investors grumbling their opinions. Still, stock prices are essentially a collection of opinions writ large upon the market, so if such fears are being voiced, it's worth putting them to the test.

And the test revealed that MGM has the strong backing of its bankers and investors, who believe the company will be just fine. It's massive portfolio of assets should also insure that MGM will be able to repay its debt.